The price elasticity of demand for a textbook is estimated to be 1 no matter what the price or quantity demanded. In this case,
What will be an ideal response?
a 10 percent increase in price will result in a 10 percent decrease in the quantity demanded.
You might also like to view...
If the required reserve ratio is 10 percent, an increase in bank reserves of $1,000 can support an increase in checking account deposits (including the original deposit) in the banking system as a whole of up to
A) $100. B) $1,000. C) $10,000. D) $100,000.
Direct transfer programs are generally less efficient and less politically acceptable than subsidy programs
a. True b. False
If in the past Congress had taken additional actions to make saving more rewarding, then today it is likely that the equilibrium interest rate
a. and the equilibrium quantity of loanable funds both would be lower. b. and the equilibrium quantity of loanable funds both would be higher. c. would be higher and the equilibrium quantity of loanable funds would be lower. d. would be lower and the equilibrium quantity of loanable funds would be higher.
The United States savings rate
A. is higher than the Chinese savings rate. B. was 10 percent in 2005. C. was the most important factor contributing to the high economic growth rate since 1995. D. usually goes up during and soon after a recession.